Vison of Life...It speaks about my views towards what's happening around us, though many of the things represents Pune, a becoming Metro in Maharashtra,India yet most of us live in similar city life. In city day to day life all we face is problems around us; from traffic to water to slums to power supply & many more, but who has solutions? That's why the name
Vison of Life!
Sanjay Deshpande

Tuesday, January 6, 2015

Where is "Happy New Year" for Real Estate?

“Cheers to a new year and another chance
for us to get it right.” …Oprah Winfrey.

Oprah Gail Winfrey is an American media
proprietor, talk show host, actress, producer, and philanthropist.Winfrey
is best known for her multi-award-winning talk show The Oprah Winfrey Show
which was the highest-rated program of its kind in history and was nationally
syndicated from 1986 to 2011.Dubbed the "Queen of All
Media",she has been ranked the richest African-American of the
20th century! Well we all know about the great TV Queen & no two minds
about her intelligence & wisdom. The quote just shows how she deserves what
brains she have & while entering in first week of the New Year this is what
the common man of Pune as well the State must be thinking when the subject is
their own home, may it be existing or the one they hoping to buy! As of now it’s
sure that more & more people will be living in cities than villages so
urban development & policies will be having high expectations from citizen
as well real estate segment. It doesn’t mean that govt should neglect
agriculture or villages as they too are equally part of any development yet
since all past years from our independence our most policies were focused around
rural development & agriculture is a fact; though what it has achieved is a
matter of debate but then that’s not object of this sharing!

The last
quarter of the past year has seen a major rather historic change in entire
nation & state on front of rulers. After many
years the state as well central elections have been contested on issues like
development, anti corruption & issues like religion or caste were put
aside. And the voters also responded this change with positive attitude,
the increase in numbers of voters vouch the same. Its start of New Year &
time to stood for the expectations of voters & sure its acid test of both
central as well state govt. As the real estate is a local issue, so we will
focus our sharing to state govt & policies being expected from the same.
The past year as well before that wasn’t much good for real estate; here many
will say it just means builders have made less profit that’s all! Well, true in a sense but when we say real
estate what we mean? Is it just builders or their suppliers & consultants
& the home buyers? Some will say it’s nothing but a chain of builders, politicians,
bureaucrats who all are interested in making money out of common man’s pocket,
that’s what real estate is! Sadly the image is both true & false; as
there exist such chains or else issue of illegal buildings would not have been
so serious all around the state. Yet on other hand real estate means thousands of small vendors,
contractors & millions of their workers whose daily wages are depending on
this industry & then millions of people who are citizen of every small town
or metros like Pune, Mumbai & their small dream rather call it a need in
actual of having a home of their own!By me it’s these citizens who are real
estate & not just the chain of some bunch of builders.

When I say real
estate didn’t has a good time it means these millions are being deprived from
having their own home because it’s gone beyond their budget & that’s the
main reason for rise in slums or illegal constructions. And it’s
here on this front we are eagerly waiting for some policies by virtue of which
the home making will be easier, faster & affordable for the builders who
mean business & it’s not just money making for them.

For
example lets take today’s news of making TDR i.e. transfer of development
rights 2.5 from 1 all over state. I won’t go in much details of what is TDR,
its potential of FSI i.e. sq ft of area one can build on any plot in proportionate
with plot area. This will enable to make nearly 2.5 times the numbers of houses
on a same plot; in nutshell if on a plot earlier 10 flats were possible to
build now there can be 25 flats! This is a great move which is going to get
criticized by media which usually favors NGO’s & they will be dead against
this. But
accept one thing land is limited & we need homes & unless we don’t
increase potential of available land there can’t be more homes unless we find another
planet to settle down!

Though NGO”s cry won’t be wrong as from last experiences
of our any policy we rarely have cared about strengthening the infrastructure
which is also a part of real estate & this we conveniently forget! And all over the State, scene is same buildings
gets constructed first, then people come to live in them & then if at all
whatever infrastructure is there, it follows! Let’s not forget only those
cities has flourished or liked by the citizen which not only provides
affordable homes to the residents of the city but gives all the necessary
infrastructure also. And here the infrastructure means right from water, public
transport, drainage, garbage treatment to medical as well educational
facilities. And look at these fronts which city in the state is doing well? At
the same time another looming danger on real estate is no control of govt on
any of the rates of the segments associated with the industry! Raw material is
land & there is no upper bar on what price a land lord should quote. Day by
day land acquiring is a pain & clear title land is more precious than gold!
Also this sky rocketing land prices have attracted bad money as well
tendencies in the business & outcome of which is gang war, this too we are
witnessing in & around Pune & even in smaller towns also! On other hand
the cement manufacturing companies unites & hikes the rates or holds the
supply & govt just keep watching. Same is true with basic materials like
sand, khadi i.e. metal & steel. Any association gets united & hike the
price of the material & no one has got any control on the hike. Reasons
they give are also outcome of poor policies by the govt. For e.g. every year
there is delay or no decision about sand digging so sand rates gets raised by
the sand suppliers. Then there always is a conflict about policy regarding carrying
capacity of the trucks which carries materials like crush sand or khadi &
using this as a tool these rates gets hiked! Basic things like water which is acquired
for the construction is again a neglected factor as local bodies ensure that
they won’t supply water to the construction site; but then from where the water
will come & at what rate the industry has to buy it? Who cares! MIDC’s i.e.
industrial development corporation gets separate water lines from dam for
various industries & irony is the real not only generates employment for
millions but provides revenue through stamp duty & many other heads of billions
of rupees to the state govt which can’t take responsibility of providing water
to the construction of these homes!

Illegal structures issue keeps on lingering
for years after years & slum developments keeps on getting regularized,
making people go for illegal constructions as no one is afraid of any action on
them.So the one who keeps
on following every procedure for getting sanction just keeps on paying interest
on his investments for the land he has made.

Leave
apart infrastructural front even the procedural front for hundreds of noc’s
& simplest things like NA i.e. non agriculture permission process needs to
be simplified; policies for the same never comes in existence & the delay for
legitimate constructions continues. Why can’t NA permission condition in itself
is removed all together where development plan or regional plan of the city or
region has been finalized is a question which no one wants to answer! Things
like demarcation of land by the state govt & uploading all the data on
central server & make “mojani’: i.e. confirming measurement of every piece
of land, we keep on reading just in news but still we require six months &
more for any demarcation is a fact. After agreement which is duly registered
yet the name of new owner don’t come on property card or 7/12 unless there are
numbers of follow-up visits to the talathi office, is a fact & we talk of digitalizing
the state! Why just land agreement, even after taking completion certificate of
a project one has to apply separately for getting name of the flat owners on property
tax, what more jokes we are going to witness! Development plans of the cities
gets delayed & entire city development gets stand still, many districts don’t
have regional plans & those who have they are outdated. Modifications to
development control rules like one stair case or parking policy or side margins
& many such, needs approval from state urban development department &
years after years these proposals remain hidden in files in Mantralay which has
been sent by local bodies; if at all they hasbeen sent in first place! No one takes review of implementation of any
development plan or regional plan but every local body does collect thousands
of crores of rupees which come from various development charges & premiums
of hundreds of projects which are ongoing without any infrastructure. If MSEB,
now MSEDCL digs a road in municipal corporation limit then they have to pay to
local body at rate Rs 2200/meter & if a developer digs the road for laying
MSEDCL’s cable as it don’t have money to lay cable, the developer has to pay at
rate Rs 4500/meter road digging charges & the cable is still owned by
MSEDCL! This happens only in India that too in Maharashtra! The ever increasing
stamp duty rates keeps reflecting the rise in home rates & again affects
all rates of premiums required for the sanctions of a project to income tax calculations
yet the real estate goes on!

After crossing all such hurdles a
legal home comes in existence but at what cost? It has to take burden of every
wrong or say delay in right policy of the govt & has to take the blame that
people in real estate are here just to make money!Affordable homes
everybody wants but what we are doing to make a home affordable, has any one
thought of it? And who in the end is sufferer of all this
mess in policy making? Well again, who cares!

Somewhere right from top to bottom,
every segment related to real estate may it be builders, suppliers, bureaucrats
or so called elected members, it’s high time to wake up & change the system
to understand that just saying “Cheers & Happy New Year” won’t make real estate
happy! Rather it’s our actions towards making homes affordable is what will
make real estate real happy, or else the new year will be just one more page on
calendar & nothing else!